Industry Members Consult Chargebacks911 for Fraud Advice
Fraud experts at LexisNexis® Risk Solutions recently released the 2015 True Cost of Fraud study. Industry professionals have been weighing in on the implications and ramifications of this study in various online publications.
Of all the discoveries made in this year’s report, there are three topics that have drawn the bulk of attention from industry insiders:
- The percentage of revenue lost to fraud is significant: 1.32% for the average merchant. This is a 94% increase from the previous year.
- The cost of managing fraud is increasing.
- Dependence on personal involvement rather than automated tools is one reason fraud mitigation efforts are so expensive.
The Green Sheet is just one of the many online publications that has chosen to address these industry-wide concerns. Interviews with payment experts clarified the implications of the much-debated results and helped merchants better understand their own contributions to these statistics.
One issue the publication chose to highlight was the obvious connection between increased fraud and increased chargebacks. To address this correlation, Monica Eaton, the industry’s highly sought-after thought leader, was asked to shed light on the subject.
In one article, Eaton mentions that businesses are performing manual reviews that are time consuming and inefficient, ultimately making the challenge of fighting fraud more costly than it needs to be. Eaton pointed out that if businesses embrace new technologies, it will reduce costs and improve efficiency.
Monica Eaton, Chief Operating Officer at Chargebacks911, a chargeback and risk mitigation firm, suggested that plenty of businesses remain in the dark when it comes to dealing with fraud. “Many businesses still don’t know how to fight against chargebacks and other forms of fraud in a healthy, cost-effective manner,” she said. “Utilizing technology where it exists will help drive down the costs of fraud by lessening the need for manual review.”
In another article, Eaton stressed that manual reviews and fraud filters need to be incorporated into the overall risk mitigation strategy. She advised merchants to consider the importance of long-term solutions as opposed to reactive, short-term ones.
One of the most effective ways merchants can protect themselves from chargebacks is to establish a proactive quality control system, looking for errors that could ultimately result in chargebacks. Eaton explains that during this quality control process, “We found that there are over 100 [errors] that have a way of causing chargebacks or decreasing revenue.”
There are many ways to tackle chargeback protection. However, if the wrong approach is taken, prevention efforts may become more of a hindrance than a help to a business.
Eaton advised, “Look at a solution as identifying all the possible threats and making sure that you’re not your own worst enemy behind the scenes.”
If you’d like more information about risk mitigation strategies, contact Chargebacks911®. We provide a free, no-obligation ROI analysis to show merchants how much more they could earn by developing a pro-active chargeback management system.
